Exelis Inc. Long Term Disability Plan. Summary Plan Description (SPD)

Transcription

1 Exelis Inc. Long Term Disability Plan Summary Plan Description (SPD) As of November 1, 2014

2 Table of Contents About this SPD...1 Important... 1 Eligibility and Participation...2 Eligibility... 2 Enrolling for Coverage... 2 When Coverage Begins... 4 How the Plan Works...5 Definition of Disability... 5 Elimination Period... 5 How Benefits Are Paid... 6 Rehabilitation... 6 Other Income Benefits...8 When Benefits End What Is Not Covered Pre-existing Condition Limitation Exclusions Situations Affecting Your Benefits Claims Procedures Filing a Claim Decisions on Your Claim Appealing a Denied Claim When Coverage Ends Administrative Information Plan Identification Numbers Plan Type Plan Year or Contribution Year Plan Sponsor and Plan Administrator Claim Administrator Plan Funding Plan Documents Legal Service Plan Future Compliance with the Law No Guarantee of Employment Reservation of Rights... 21

3 Your Rights Under ERISA Receive Information About Your Plan Benefits Prudent Actions by Plan Fiduciaries Enforce Your Rights Assistance with Your Questions Glossary of Terms... 24

4 About this SPD Exelis Inc. (the Company ) sponsors the Long-Term Disability Plan (the LTD Plan or the Plan ) for non-bargained employees and certain bargained employees as an important part of your Companyprovided benefits. This booklet describes the provisions of the Exelis Inc. Long-Term Disability Plan as of November 1, It serves as the Summary Plan Description (SPD) required under the Employee Retirement Income Security Act of 1974 (ERISA) for the LTD Plan. Please read it carefully and share it with your family members. MetLife administers and insures the Plan. Additional plan documents can be found on ExelisPowerofYOU.com under the Financial Protection Documents section of the My Resources tab. These documents provide information on: Eligibility for coverage, enrolling for coverage, when coverage begins and when coverage ends; A description of the Exelis LTD Plan; Important administrative information about the Plan and your rights under the Employee Retirement Income Security Act (ERISA); and A glossary of terms. If you have any questions about the benefits outlined in this SPD, please contact Human Resources Shared Business Services (HR SBS) at PowerofYOUBenefits@exelisinc.com or by calling SBS-DESK ( ), Option 2, Monday through Friday from 8:00 a.m. to 5:00 p.m. Eastern Time. You can also call MetLife at Customer service representatives are available to help you with questions Monday through Friday, from 8:00 a.m. to 11:00 p.m. Eastern time. Important This SPD is only a summary of the LTD benefits provided by the Plan. If there is any conflict between this SPD and the insurance contract that governs how the LTD benefits are funded and the LTD Plan is administered, the insurance contract, including any amendments, will govern. Written or oral statements made to you from human resources (HR) representatives or other personnel do not modify the Plan s terms. The Company expects to continue the Plan indefinitely. However, The Company reserves the right to amend, suspend or terminate the Plan, in whole or in part, from time to time or at any time. Participation in the Plan is not a contract of employment and does not constitute a contract for, nor guarantee of, continued or future employment with The Company. The Plan provisions also do not prohibit changes in the terms of your employment. Exelis Inc. Long-Term Disability Plan 1

5 Eligibility and Participation Eligibility You are eligible to participate in the Exelis Inc. LTD Plan if you are: a regular full-time or part-time (normally scheduled to work at least 20 hours a week) employee; on a U.S. payroll; and employed by Exelis Inc. or a division, subsidiary, affiliate or unit that is participating in the Plan, or employed by Vectrus, Inc. or Vectrus Systems Corporation in connection with the spin-off of Exelis Systems Corporation on September 27, If you are not a U.S. citizen, you are only eligible to participate in the Plan while you are working in the United States. Contact HR SBS for more information about your eligibility for the Plan. Who Is Not Eligible You are not eligible to participate in the Plan if you are: An intern/co-op student; A consultant; A leased employee; Paid by a third-party employer; or Otherwise not classified as an employee by the Company, acting in its capacity as the employer, on its payroll records, even if a determination is made by the Internal Revenue Service or other governmental agency or court, after the individual is engaged to perform such services, that the individual is an employee of the Company. Enrolling for Coverage As a new hire or newly eligible employee, you are automatically enrolled in the LTD Plan unless you decline coverage during your first 60 days of employment. If you decline coverage during your first 60 days of employment and have already paid any premiums, you will be reimbursed for those premiums. If you were an active employee as of October 3, 2014, and were not already enrolled in the Plan, you were automatically enrolled effective November 1, 2014, unless you declined coverage. Exelis Inc. Long-Term Disability Plan 2

6 You may decline coverage at any time after you are enrolled by contacting HR SBS at but you will only be eligible to have your premiums refunded if you decline within 60 days of your enrollment. If you decline coverage when you are first eligible, you can still enroll at a later date. However, you will have to provide satisfactory medical evidence of good health at your own expense and your coverage will not take effect until MetLife approves your application. You may also be eligible to enroll after a Qualifying Life Event. See additional information that follows. Qualifying Life Event If you do not decline coverage, your coverage will remain in effect until you opt out. If you do decline coverage, you can enroll at a later time without providing any medical evidence if you have a Qualifying Life Event (also known as a Life Event ). You must enroll within 30 days of the qualifying event. If you miss the 30-day deadline, you can still enroll in the Plan, but will need to provide medical evidence to MetLife. Enrollment elections may be made in Workday or by contacting HR SBS via at PowerofYOUBenefits@exelisinc.com or phone at SBS-DESK, Option 2. Qualified changes in status under the Exelis LTD Plan are listed in the following table. Qualifying Life Event Marriage Birth, legal adoption or placement for legal adoption of a child Changes in employment status that affect coverage (you or your covered dependents) Changes in your or your eligible dependent s coverage (including coverage changes under another employer s plan) due to an open enrollment change, significant change in cost of coverage or significant change in level of benefits. (Special limits may apply when the Life Event is a change in cost or coverage.) Exelis LTD Plan Changes Elect coverage Elect coverage Cancel or elect coverage Cancel or elect coverage If Your Employment Status Changes In certain instances, an employment status change may affect your benefit options. If your employment status changes (i.e., changing from part-time to full-time, starting or ending an international assignment or transferring jobs or union status), please contact HR SBS to determine if you need to make new elections. Cost of Coverage You pay the full cost of LTD coverage. After you enroll, contributions for coverage are automatically deducted from your paycheck on an after-tax basis. The cost for coverage is available through Workday and is calculated using your annual base salary. (See definition of Pre-Disability Earnings in the Glossary of Terms section.) Employee contributions are subject to review and periodic change by the Company. Your LTD contribution will automatically change when your salary changes. Exelis Inc. Long-Term Disability Plan 3

7 Waiver of Contributions You will not be required to pay contributions during any period in which you are receiving LTD benefits. When Coverage Begins If you do not decline coverage when you are first eligible, your coverage begins on the first day of employment (or the first day you are eligible, if later). If you opt out of coverage when you first become eligible and choose to enroll at a later time, your coverage will take effect on the date that MetLife approves your written application for coverage. If you opt out of coverage and later decide to enroll because of a Qualifying Life Event, your coverage will take effect on the day you make your election. You must be actively at work on the day your coverage begins. If you are not actively at work on the day coverage would normally begin, coverage will not begin until the date you return to active work. If you have a pre-existing condition, coverage for that condition will not begin until you have completed 12 months of continuous employment after your coverage becomes effective. See the Pre-Existing Condition Limitation section for more information. Your coverage will continue during any approved absence from work due to injury or sickness as long as you continue to make any required LTD contributions. This includes any period while you are receiving short-term disability (STD) benefits. Your coverage cannot end while you are meeting the Elimination Period for benefits (as long as you continue to make any required LTD Plan contributions), or while you are receiving LTD benefit payments. See the Elimination Period section for more information. If You Terminate Employment or You Are Rehired If your employment terminates your eligibility for LTD coverage will terminate on your last day worked. If your disability began while you were covered under the Plan and your disability meets Plan provisions, you may file a claim for LTD benefits after your employment ends. If you return to work from a temporary layoff or leave of absence and you previously participated in the LTD Plan, your coverage will be reinstated immediately. If you terminate employment and you are later rehired, or if your coverage ends because you are no longer an eligible employee and you become eligible again at a later date, you will be considered a new employee for Plan purposes. This means you will automatically be enrolled in the Plan unless you opt out during your first 60 days of re-employment. Your coverage will begin on the first day you are actively at work after completing any applicable waiting period. You will be subject to the pre-existing condition limitation, as described in the Pre-existing Condition Limitation section. Exelis Inc. Long-Term Disability Plan 4

8 How the Plan Works Under the LTD Plan, you receive a monthly benefit equal to 60% of your base monthly salary (up to a maximum benefit of $12,500 per month) if an illness or injury keeps you from working. Your base monthly salary is your regular base salary, not including overtime, bonuses, Foreign Service premiums, allowances or other special forms of compensation. If you receive all or part of your earnings as commissions, your HR SBS can tell you how your benefits will be determined and the amounts of your payroll deductions for coverage. (See also definition of Pre-Disability Earnings in the Glossary of Terms section.) To qualify for LTD benefits, you must be Disabled as defined by the Plan. Definition of Disability You are considered Disabled if you have a Sickness or injury and are: receiving Appropriate Care and Treatment, complying with the requirements of such treatment; and unable: during the Elimination Period and the first 12 months (18 months total) you are Sick or injured, to earn more than 80% of your Pre-Disability Earnings at your own occupation from any employer in your Local Economy; and after 18 months, to earn more than 80% of your Pre-Disability Earnings from any employer in your Local Economy at any gainful occupation for which you are reasonably qualified by your training, education and experience. You will not be considered Disabled as a result of an injury unless your disability occurred within 90 days of an accidental injury and resulted directly from such injury, independent of other causes. If your occupation requires a license, the fact that you lose your license for any reason will not, in itself, constitute Disability. Elimination Period Benefits begin after you complete a six-month Elimination Period, beginning with the first day of your disability. You must be under the continuous care of a physician during this entire period. No LTD benefits are paid during your Elimination Period. Temporary Recovery During Your Elimination Period If you return to work for 30 days or less during your Elimination Period, those days (or partial days) will count toward your Elimination Period. However, if you return to work for more than 30 days before you meet your Elimination Period, you will have to begin a new Elimination Period. Exelis Inc. Long-Term Disability Plan 5

9 Temporary recovery means you cease to be disabled. During a period of temporary recovery, you will not qualify for any change in coverage caused by a change in: The rate of earnings used to determine your Pre-Disability Earnings, or The terms, provisions or conditions of the Plan s Certificate of Insurance. Recurring Disability A disability is recurring when you temporarily recover, return to work for six months or less, and suffer a relapse related to your prior disability. If you have a recurring disability, your periods of disability are treated as one continuous period of disability. This means that you do not need to meet another Elimination Period. How Benefits Are Paid If your claim is approved, you will start earning benefits on the date after you complete your Elimination Period. Your first payment will be made on the first day of the month after the month in which you start to earn benefits, and will continue monthly as long as you remain Disabled. Payment will be based on the number of days you are Disabled during each month. After you have received LTD Plan benefits for 12 months, MetLife will adjust your Pre-Disability Earnings to determine whether you continue to be Disabled, and to calculate the impact of rehabilitation earnings on your LTD Plan benefits (see the Rehabilitation section below. In the first year, MetLife will add to your Pre-Disability Earnings an amount equal to: Your Pre-Disability Earnings times the lesser of 7% or the percent increase in the Consumer Price Index (CPI) for the prior calendar year Rehabilitation MetLife provides several programs and incentives to encourage you to return to work. If you participate in a Rehabilitation Program, your benefit will be increased by 10% before any reductions for Other Income Benefits are applied. If you work while you are Disabled and receiving benefits, your LTD benefits will continue, reduced by 50% of the amount of rehabilitation earnings you may receive (subject to the $300 minimum benefit provision). If the total of your earnings and Other Income Benefits is more than 100% of your Pre- Disability Earnings, your LTD benefit will be reduced by the amount in excess of your Pre-Disability Earnings. You may also be entitled to continue receiving Social Security disability benefits for a period of time, no matter how much you earn. If you need more information about this program, contact MetLife. Exelis Inc. Long-Term Disability Plan 6

10 How LTD Benefits Are Taxed Under current tax law, any benefit you receive from the Plan due to disability is not taxable because you pay the full cost of any LTD coverage with after-tax money. No Assignment Your rights and benefits under the Plan cannot be assigned, sold or transferred to your creditors or anyone else. If You Die If you die while receiving benefits, MetLife will pay any due and unpaid benefits to your beneficiary. If you haven t designated a beneficiary or your beneficiary died before you do, the Plan will pay benefits to (in this order): Your surviving spouse Your child(ren) Your parent(s) Your sibling(s) or Your estate. If more than one person is eligible for payment, MetLife will split the benefit into equal shares. Exelis Inc. Long-Term Disability Plan 7

11 Other Income Benefits Your LTD benefits will be reduced by benefits payable to you from the following other income benefits: Any disability or retirement benefits which you, your spouse or child(ren) receive or are eligible to receive because of your disability or retirement under: Federal Social Security Act; Railroad Retirement Act; any state or public employee retirement or disability plan; or any pension or disability plan of any other nation or political subdivision thereof. Any income received for disability or retirement under an Exelis retirement plan, to the extent it can be attributed to Company contributions. Any income received for disability under: A group insurance policy to which Exelis has contributed, such as: benefits for loss of time from work due to Disability; installment payments for permanent total Disability; A no-fault auto law for loss of income, excluding supplemental disability benefits; A statutory benefit plan or program which provides payment for loss of time from your job due to your disability, whether such payment is made directly by the plan or program, or through a third party; A self-funded plan, or other arrangement if Exelis contributes toward it or makes payroll deductions for it; Any sick pay, vacation pay or other salary continuation that Exelis pays you; Workers' compensation or a similar law which provides periodic benefits; Occupational disease laws; Laws providing for maritime maintenance and cure; Unemployment insurance law or program; Any income that you receive for working while Disabled including but not limited to salary, commissions, overtime pay, bonus pay or other extra pay arrangements from any source. Recovery amounts that you receive for loss of income as a result of claims against a third party by judgment, settlement or otherwise including future earnings. Only the benefits payable from these sources are used in determining the reduction to your LTD benefit. Your benefits will not be reduced by: Cost-of-living adjustments paid under any of the above Other Income sources; Reasonable attorney fees included in any award or settlement (if the attorney fees are incurred because you successfully pursued Social Security disability benefits, such fees are limited to those approved by the Social Security Administration); Group credit insurance; Mortgage disability insurance benefits; Exelis Inc. Long-Term Disability Plan 8

12 Early retirement benefits you have not taken voluntarily; Veteran s benefits; Individual disability income insurance policies; Benefits received from an accelerated death benefit payment; or Amounts rolled over to a tax qualified plan unless you subsequently receive them while are receiving benefit payments. Single Sum Payments If you receive Other Income Benefits in a single sum payment, you must, within 10 days, provide written proof to MetLife of: the amount of the single sum payment; the amount to be attributed to income replacement; and the time period for which the payment applies. MetLife will adjust the amount of your monthly benefit appropriately, but not below the minimum benefit limit (unless there has been an overpayment). If you don t provide MetLife with the information described above, and MetLife discovers the amount of the single sum payment, your LTD benefit may be reduced by an amount equal to such benefit until the single sum has been exhausted. Minimum Benefit The Plan provides a minimum monthly benefit of $300. However, if your rehabilitation earnings plus other income benefits total more than 100% of your base monthly salary when you became disabled, the minimum benefit will be adjusted so that your total income will not exceed your earnings as of your date of disability. Social Security If your disability qualifies as total and permanent under Social Security, you are entitled to receive Social Security income benefits after five months of continuous disability. After 24 months of total disability, you can qualify for Medicare protection even if you are under age 65. Your LTD benefit is reduced by your Social Security award amount, including any benefits available to your dependents. Increases in other income benefits due to cost of living adjustments, including Social Security benefits, will not be considered after the first reduction for other income benefits. If Social Security denies your initial claim for disability, you should appeal the decision. Denials are often reversed on appeal. MetLife may help you with this effort. Once Social Security benefits are awarded, you must contact MetLife to discuss any retroactive payment that you received that may be due them, as well as the amount of the award by which your LTD benefit will be offset. Exelis Inc. Long-Term Disability Plan 9

13 If you do not claim Social Security benefits, your disability benefits may be adversely affected. Contact MetLife for more information or help about Social Security disability benefits. Benefit Adjustments for Social Security and Other Income Benefits Within six months after you become Disabled, you must send MetLife proof that you have applied for Social Security benefits and sign a: Reimbursement agreement, in which you agree to repay MetLife for any overpayments they may make to you; and Release authorizing the Social Security Administration to provide information to MetLife about your eligibility for Social Security benefits. Once you have been receiving LTD payments for 24 months, MetLife may reduce your benefit by an estimate of the amount of Social Security benefits you, your spouse or child(ren) are eligible to receive because of your Disability or retirement. You can avoid this reduction if you send MetLife: Approval of your claim for Social Security benefits; or A notice of denial of Social Security benefits, indicating that you have exhausted all levels of appeal. Once you receive approval or final denial of your claim for Social Security benefits you must notify MetLife immediately. Your LTD benefit will be adjusted appropriately; you must repay MetLife for any overpayment. Exelis Inc. Long-Term Disability Plan 10

14 When Benefits End Your LTD benefits end on the earliest of the date: MetLife determines you are not disabled; Your maximum benefit period ends (as shown below); You die; You refuse, without good cause, to fully cooperate in all required phases of a rehabilitation plan; You refuse, without good cause, to fully cooperate in a transitional work arrangement; You are no longer receiving appropriate care; or You fail to cooperate with MetLife in the administration of the claim. Cooperation includes, but is not limited to, providing any information or documents needed to determine if benefits are payable or the actual benefit amount due. Benefits may be resumed if you begin to cooperate fully in the rehabilitation plan or a transitional work arrangement within 30 days of the date benefits terminated. MetLife makes all determinations of eligibility for continued benefits. Maximum Benefit Period Payments continue until the earlier of the date you recover from the disability or to the maximum benefit period, as follows: Your Age When You Became Disabled Maximum Benefit Period Age 61 or less To the end of the month in which you turn age 65 Age 62 3 years Age 63 2 years, 6 months Age 64 2 years Age 65 1 year, 6 months Age 66 1 year, 6 months Age 67 or older 1 year Exelis Inc. Long-Term Disability Plan 11

15 What Is Not Covered Pre-existing Condition Limitation Coverage for a pre-existing condition will not start until you have completed a 12-month period of continuous employment while a Plan participant. A pre-existing condition is an illness or injury for which you have had medical treatment during the three months before the date you became a participant in this Plan. Pregnancy is also considered a pre-existing condition. Exclusions The Plan does not cover disabilities due or related to any of the following: war, whether declared or undeclared, or act of war, insurrection, rebellion or terrorist act; your active participation in a riot; intentionally self-inflicted injury; attempted suicide; or commission of or attempt to commit a felony. Exelis Inc. Long-Term Disability Plan 12

16 Situations Affecting Your Benefits Continuation of Coverage While on an Unpaid Leave of Absence LTD coverage under the Plan will not continue during an approved unpaid leave of absence, except for a leave of absence under a state or federal family or medical leave. During an unpaid family or medical leave period, you may continue your LTD coverage as long as you pay the required contributions. Your coverage will not continue after the family or medical leave of absence ends. HR SBS will provide you with information about continuing coverage while on a family or medical leave of absence, including any special family and medical leave requirements in your state. Continuation of Benefits While on a Family and Medical Leave (FMLA) Under the federal Family and Medical Leave Act (FMLA), if you meet eligible service requirements, you are entitled to take up to 12 weeks of unpaid leave for certain family and medical situations. If you are eligible, you can take up to 12 weeks of unpaid leave in a 12-month period for the following reasons: For the birth and care of your newborn child or a child that is placed with you for adoption or foster care For the care of a spouse, child, or parent who has a serious health condition For your own serious health condition For a qualifying exigency arising because your spouse, child or parent is on active duty or call to active duty in the Armed Forces in support of a contingency operation For the care of a covered service member with a serious injury or illness incurred in the line of duty on active duty, if you are the spouse, parent, child or next of kin of the covered service member. Depending on the state you live in, the number of weeks of unpaid leave available o you for family and medical reasons may vary based on state law requirements. Continuation of Coverage for Employees in the Uniformed Services (USERRA) The Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA) guarantees certain rights to eligible employees who enter military service. The terms Uniformed Services or Military Service mean the Armed Forces (i.e., Army, Navy, Air Force, Marine Corps, Coast Guard), the reserve components of the Armed Services, the Army National Guard and the Air National Guard when engaged in active duty for training, inactive duty training, or full-time National Guard duty, the commissioned corps of the Public Health Service, and any other category of persons designated by the President in time of war or national emergency. Upon reinstatement, you are entitled to the seniority, rights and benefits associated with the position held at the time employment was interrupted, plus additional seniority, rights and benefits that would have been attained if employment had not been interrupted. Exelis Inc. Long-Term Disability Plan 13

17 In general, to be eligible for the rights guaranteed by USERRA, you must: Return to work on the first full, regularly scheduled workday following your leave, safe transport home, and an eight-hour rest period if you are on a military leave of less than 31 days Return to or reapply for employment within 14 days of completion of such period of duty, if your absence from employment is from 31 to 180 days Return to or reapply for employment within 90 days of completion of your period of duty, if your military service lasts more than 180 days. Your Human Resources representative will provide you with information about continuing coverage while on a family or medical leave of absence, including any special family and medical leave requirements in your state. How Benefits Can Be Forfeited or Delayed Benefits can be forfeited or delayed under certain situations. Most of these circumstances are described in the previous sections. However, benefit payments also may be forfeited or delayed if: You do not properly apply for benefits within the time periods required You do not furnish information required by MetLife to complete or verify your claim, or Your current address is not on file with the Company or with the Claim Administrator. Exelis Inc. Long-Term Disability Plan 14

18 Claims Procedures Filing a Claim If MetLife is administering your Short Term Disability (STD) benefit, they will automatically transition you to LTD at the proper time. MetLife will reach out to you for any additional information to continue review and determine your LTD benefits. If MetLife is not administering your Short Term Disability (STD) benefits, you must file a claim by contacting MetLife at You must provide notice of your claim and required proof within 90 days of the date you become Disabled. However, your benefits will not be denied or reduced if you miss this deadline, as long as you provide notice and proof as soon as you reasonably can. If you file a claim for LTD benefits and your claim is denied, you have the right to appeal the decision. See the Appealing a Denied Claim section for more information. Decisions on Your Claim For LTD benefits under the Plan, MetLife reviews the claim and notifies you of its decision no later than 45 days after receiving the claim, unless you need to provide additional information. MetLife may have up to two additional extensions of 30 days each to provide your notification. If MetLife needs more information to make a decision about your claim, you will be notified during the initial 45-day period (or before the end of the first 30-day extension period if a second 30-day period is needed). If you are asked to provide additional information, you have up to 45 days from the date you receive the extension notice to provide the requested information. All extension notices you receive regarding your disability benefits must specifically explain: The standards on which entitlement to a benefit is based; The unresolved issues that prevent a decision on the claim; and The additional information needed to resolve those issues. MetLife will provide you with written notification if your claim is denied. The notification will contain the following information: The specific reason(s) for the denial; References to the specific plan provisions on which the denial is based; A description of any additional material or information needed to process the claim and an explanation of why that material or information is necessary; A description of the Plan s appeal procedures and the time limits applicable to those procedures, including a statement of your right to bring a civil action under ERISA after an appeal of an adverse benefit determination; Any specific rule, guideline, or protocol that was relied upon or a statement that such rule, guideline or protocol was relied upon and that you may request a copy of it free of charge; and Exelis Inc. Long-Term Disability Plan 15

19 If the adverse determination is based on a medical necessity, an explanation of the scientific or clinical judgment or a statement that you may request such explanation free of change. You have the right to request and receive reasonable access to and copies of relevant documents, records and other information in the Plan Administrator s possession free of charge. For this purpose, a document, record or other information is treated as relevant to your claim if it: Was relied upon in making the benefit determination; Was submitted, considered or generated in the course of making the benefit determination, regardless of whether the document, record or other information was relied upon in making the benefit determination; or Demonstrates compliance with the administrative processes and safeguards required in making the benefit determination. Appealing a Denied Claim If your claim is denied, you may ask for a review. You have 180 days to appeal a denied claim. Your appeal must be made in writing and contain the reasons why you believe you are entitled to benefits. Along with your appeal, you have the right to: Submit written comments, documents, records and other information relating to the claim for benefits; Request, free of charge, reasonable access to and copies of all documents, records and other information relevant to your claim for benefit; A review that takes into account all comments, documents, records and other information submitted by you related to the claim, regardless of whether the information was submitted or considered in the initial benefit determination; A review that does not defer to the initial adverse benefit determination; A review that is not conducted by the individual who made the adverse determination or who is a subordinate of that person; If the appeal involves an adverse benefit determination based in whole or in part on a medical judgment, a review in which MetLife consults with a health care professional who has appropriate training and experience in the specific field involved in the medical judgment; this health care professional must not have been consulted in connection with the initial adverse benefit determination or be the subordinate of a person who was consulted; and The identification of the health care professional whose advice was obtained in connection with the adverse benefit determination, regardless of whether the advice was relied upon in making the decision. Ordinarily, a decision about your appeal will be reached within 45 days after receipt of your request for review, unless MetLife notifies you within that period that there are special circumstances requiring an extension of up to 45 additional days. Exelis Inc. Long-Term Disability Plan 16

20 You will have 45 days to provide requested information from the date you receive the notice from MetLife. MetLife s notice of an adverse benefit determination on review will contain all of the following information: The specific reasons for the adverse benefit determination; References to the specific Plan provisions on which the benefit determination is based; A statement that you are entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information relevant to your claim; A statement describing any voluntary appeal procedures offered by the Plan and your right to obtain the information about such procedures, and a statement of your right to bring an action under ERISA; Any internal rule, guideline, protocol, or other similar criterion relied upon in making the adverse benefit determination; or a statement that a copy of this information will be provided free of charge to you upon request; and If the adverse benefit determination was based on medical necessity or experimental treatment or similar exclusion or limit, either an explanation of the scientific or clinical judgment for the adverse determination, applying the terms of the Plan to your medical circumstances, or a statement that such explanation will be provided free of charge upon request. Time Limit on Legal Actions After a claim is denied upon appeal, you may bring a lawsuit in either state or federal court. However, you must use and exhaust this Plan s administrative claims and appeals procedures before bringing a lawsuit. Similarly, if you do not follow the Plan s procedures in a timely manner, you will lose your right to sue for a denied claim. You may only bring legal action on a claim against MetLife during the period beginning 60 days after the date you provide proof of your claim and ending three years after the date such proof is required. Exelis Inc. Long-Term Disability Plan 17

21 When Coverage Ends In general, if you are not disabled, coverage under the LTD Plan ends when you stop making contributions for coverage or your employment terminates. Coverage may also end if: Exelis terminates the Plan; You are no longer an eligible employee; or Your Company is no longer a participating unit in the Plan. If your coverage ends for any of the reasons listed above but you were already disabled as determined by MetLife, your coverage may continue for that disability. If you are receiving Plan benefits, benefits may continue. If you are disabled but you have not yet started receiving Plan benefits, you may be eligible to receive benefits once the waiting period has ended as long as you continue to make contributions to the Plan during the Elimination Period. Exelis Inc. Long-Term Disability Plan 18

22 Administrative Information The following information provides details about how the Plan is administered and who is responsible for interpreting and enforcing Plan rules. Plan Identification Numbers The Plan is identified by the following numbers under Internal Revenue Service rules: Employer Identification Number: Plan Number: 802 Plan Type The LTD Plan is a Welfare Benefit Program under the Exelis Corporate Welfare Plan. Plan Year or Contribution Year The plan year is January 1 through December 31. Plan Sponsor and Plan Administrator The Plan Sponsor and Plan Administrator is: Exelis Inc Tysons Blvd. Suite 1700 McLean, VA The Plan Sponsor and/or Plan Administrator may delegate various duties and responsibilities to one or more employees or agents. Claim Administrator MetLife 130 Hall Boulevard Bloomfield, CT Plan Funding The Plan is fully insured. Premium is paid by Employees and claims are paid by MetLife. Exelis Inc. Long-Term Disability Plan 19

23 Plan Documents This booklet, which is intended to be a Summary Plan Description under ERISA, summarizes the Plan and does not attempt to cover all its details. These are provided in the insurance contract which governs how LTD Plan benefits are funded and how the LTD Plan is administered. If there is a conflict between the insurance contract and this booklet, the Plan document will prevail. The official Plan document and Summary Plan Description as well as the annual report of Plan operations as filed with the U.S. Department of Labor, are available for review through your Human Resources representative during normal working hours. Upon written request to your Human Resources representative, copies of any of these documents will be provided to you or your beneficiary. You may be charged a reasonable fee. Legal Service Process can be served on the Plan at the following addresses: For the Plan and Plan Administrator: Exelis Inc Tysons Blvd. Suite 1700 McLean, VA For MetLife: MetLife 130 Hall Boulevard Bloomfield, CT Plan Future The Company expects to continue the Plan. However, the Company reserves to right to amend, suspend or terminate the plan in whole or part at any time or from time to time. If the Plan is terminated, your Long Term Disability coverage will end. Subject to Plan provisions, benefit payments for approved Long Term Disability claims incurred before the Plan termination will continue. LTD claims incurred before the Plan termination, but reported after the Plan termination, may be covered. Compliance with the Law The terms of this Plan and the administration of the Plan comply with all applicable laws and regulations. If changes in law or regulations require that changes be made to the Plan, those changes in law or regulations will govern. Exelis Inc. Long-Term Disability Plan 20

24 No Guarantee of Employment Your participation or eligibility for benefits under the Plan described in this booklet is no guarantee of continued employment with Exelis Inc. Reservation of Rights As provided in all Exelis Inc. benefits plans, the terms and conditions of the Plan documents will govern and while Exelis Inc. expects to continue the Plan, it reserves the right to change or discontinue the Plan at any time with respect to some or all participants. Exelis Inc. Long-Term Disability Plan 21

25 Your Rights Under ERISA As a participant in the Plan, you are entitled to certain rights and protections under the Employee Retirement Income Security Act of 1974 (ERISA), as amended. ERISA provides that all Plan participants are entitled to: Receive Information About Your Plan Benefits You are entitled to examine without charge, at the Plan Administrator s office and at other specified locations, such as work sites and union halls, all documents governing the Plan, including insurance contracts and collective bargaining agreements. You can obtain a copy of the latest annual report (Form 5500 Series) filed by the Plan with the U.S. Department of Labor, which is available at the Public Disclosure Room of the Employee Benefits Security Administration. You can obtain, upon written request to the Plan Administrator, copies of documents governing the operation of the Plan, including insurance contracts and collective bargaining agreements, copies of the latest annual report (Form 5500 Series) and an updated Summary Plan Description. The Plan Administrator may make a reasonable charge for the copies. You are entitled to receive a summary of the Plan s annual financial report. The Plan Administrator is required by law to furnish each participant with a copy of this summary annual report. You can receive a copy of the Qualified Medical Child Support Order procedures without charge. You can receive a listing of In-Network Providers without charge. Prudent Actions by Plan Fiduciaries In addition to creating rights for Plan participants, ERISA imposes duties upon the people who are responsible for the operation of the Plan. The people who operate the Plan, called fiduciaries of the Plan, have a duty to do so prudently and in the interest of you and other Plan participants and beneficiaries. No one, including your employer or any other person, may fire you or otherwise discriminate against you in any way to prevent you from obtaining a benefit or exercising any of your rights under ERISA. Enforce Your Rights If a claim for a Plan benefit is denied or ignored, in whole or in part, you have a right to know why this was done, to obtain copies of documents relating to the decision without charge and to appeal any denial, all within certain time schedules. Exelis Inc. Long-Term Disability Plan 22

26 Under ERISA, there are steps you can take to enforce the above rights. For instance, if you request a copy of Plan documents or the latest annual report from the Plan and do not receive them within 30 days, you may file suit in a federal court. In such a case, the court may require the Plan Administrator to provide the materials and pay you up to $110 per day until you receive the materials, unless the materials were not sent because of reasons beyond the control of the administrator. If you have a claim for benefits that is denied or ignored, in whole or in part, you may file suit in state or federal court, but only after you have exhausted the Plan s claims and appeals procedures as described in the Your Right to Appeal section. In addition, if you disagree with the Plan s decision concerning the status of a qualified medical child support order, you may file suit in federal court. If it should happen that Plan fiduciaries misuse the Plan s money, or if you are discriminated against for asserting your rights, you may seek assistance from the U.S. Department of Labor, or you may file suit in federal court. The court will decide who should pay court costs and legal fees. If you are successful, the court may order the person you have sued to pay these costs and fees. If you lose, the court may order you to pay these costs and fees, for example, if it finds your claim is frivolous. Assistance with Your Questions If you have any questions about your Plan, you should contact the Plan Administrator. If you have any questions about this statement or about your rights under ERISA, or if you need assistance in obtaining documents from the Plan Administrator, you should contact the nearest area office of the Employee Benefits Security Administration (EBSA), U.S. Department of Labor, listed in your telephone directory, or you can write to The Division of Technical Assistance and Inquiries Employee Benefits Security Administration U.S. Department of Labor 200 Constitution Avenue, NW Washington, DC You may also obtain certain publications about your rights and responsibilities under ERISA by calling the publications hotline of the Employee Benefits Security Administration at (866) 444-EBSA, logging on to or contacting the EBSA field office nearest you. Exelis Inc. Long-Term Disability Plan 23

27 Glossary of Terms Terms defined in this section have special meaning in the Plan. Active Service If you are an employee, you are in active service on a Company scheduled work day if: You are actively at work, which means you are performing your regular occupation for the Company on a full-time or part-time basis, either at one of the Company s usual places of business or at some location to which the Company s business requires you to travel; or The day is a scheduled holiday, vacation day or Company-approved paid leave of absence period. You are in active service on a day that is not one of the employer's scheduled work days only if you were in active service on the preceding scheduled work day. Appropriate Care Medical care and treatment that is: received from a doctor whose medical training and clinical experience are suitable for treating your disability; consistent in type, frequency and duration of treatment with relevant guidelines of national medical, research and health care coverage organizations and governmental agencies; consistent with a doctor s diagnosis of your condition; and meant to maximize your medical improvement. Company Exelis Inc. and its designated divisions, subsidiaries, affiliates and units that participate in the Plan. Disabled or Disability You are considered Disabled if, due to Sickness or as a direct result of accidental injury: You are receiving Appropriate Care and Treatment and complying with the requirements of such treatment; and You are unable to earn: during the six-month Elimination Period and the next 12 months of Sickness or accidental injury, more than 80% of your Pre-Disability Earnings at your own occupation from any employer in your Local Economy; and after this 18-month period, more than 80% of your Pre-Disability Earnings from any employer in your Local Economy at any gainful occupation for which you are reasonably qualified by your training, education and experience. To determine whether a Disability is the direct result of an accidental injury, you must have become Disabled within 90 days of the injury, independent of other causes. If your occupation requires a license, loss of your license will not, in itself, constitute Disability. Exelis Inc. Long-Term Disability Plan 24

28 Elimination Period The period of your Disability where no benefits are paid. The Elimination Period begins on the day you become Disabled and continues for six months. Injury Any accidental loss or bodily harm that results directly and independently from all other causes from an accident. Local Economy the geographic area: Within which you live and Which offers suitable employment opportunities within a reasonable travel distance. Participating Unit Any division, subsidiary, affiliate or unit of Exelis designated to participate in the Plan. Physician A licensed doctor practicing within the scope of his or her license and providing care and treatment that is appropriate for the condition and locality. The term does not include you, your spouse, your immediate family (including parents, children, siblings or spouses of any of the foregoing, whether the relationship derives from blood or marriage) or a person living in your household. Pre-Disability Earnings The gross monthly salary or wages you were earning as of your last day of Active Work before you became Disabled. If You do not have regular work hours, your Pre-Disability Earnings are based on the average number of hours you worked per month during the preceding 12 calendar months (or during your period of employment if less than 12 months). In no event will the number of hours be more than 173 hours. The term includes: contributions you were making on a pr e-tax basis for: an Internal Revenue Code (IRC) Section 401(k), 403(b) or 457 deferred compensation arrangement; an executive non-qualified deferred compensation arrangement; and your fringe benefits under an IRC Section 125 plan. The term does not include: commissions; awards and bonuses; overtime pay; the grant, award, sale, conversion and/or exercise of shares of stock or stock options; Company contributions on your behalf to any deferred compensation arrangement or pension plan; or any other Company compensation. Exelis Inc. Long-Term Disability Plan 25

29 Rehabilitation Plan A program approved by MetLife designed to enable you to return to work. Your plan may include: return to work on a modified basis with a goal of resuming employment for which you are reasonably qualified by training, education, experience and past earnings; on-site job analysis; job modification/accommodation; training to improve job-seeking skills; vocational assessment; short-term skills enhancement; vocational training; or therapy to improve functional capacity to return to work. Sickness A physical or mental illness. Exelis Inc. Long-Term Disability Plan 26